Demand rockets for low cost rental apartments

Demand rockets for low cost rental apartments

About 20 percent of the new housing built in Vientiane every year consists of low-rental apartments that accommodate people moving to the capital from the provinces.

Real estate analysts say the demand for low-rental apartments is growing rapidly, and now exceeds supply quite substantially, with demand for affordable housing growing at about 30 percent annually.

Head of the Housing and Town Planning Division under Vientiane's Public Works and Transport Department, Mr Phoutthaphone Khotpanya, told Vientiane Times yesterday that the number of low-rental facilities has risen to more than 2,000 in total.

He explained that the majority of people who rented low-cost apartments were students from the provinces, followed by former students who stayed on to look for jobs or to work in the city.

Some workers and traders also rent these apartments while working or trading in the capital. Affordable rental apartments generally range in price from 250,000 kip to 500,000 kip per month, putting them within reach of students and labourers, particularly if they share.

Affordable housing in good locations is always booked in advance, particularly when situated near to educational institutions.

Those located in the inner districts of Vientiane, namely Chanthabouly, Sisattanak, Xaysettha and Sikhottabong, are always in demand.

Vientiane's economy is continuing to grow rapidly due to the rapid inflow of foreign investment, generating job opportunities in the capital and attracting people from the provinces.

Managing Director of RentsBuy Co., Ltd., Mr Houmphan Salyalath, said most Lao people prefer low-rental apartments simply because they are cheap.

The villages of Sibounheuang, Phonthong, Don Daeng and Sikhay are among those that have a lot of low-rent apartments catering to the influx of people from outside of the capital.

Mr Houmphan said many more people have moved from rural areas to live in Vientiane to work, study and do business, which is driving the stronger demand for rental properties.

It is unclear how many non-Vientiane residents live in the capital currently but experts predict there could be many hundreds of thousands of people now residing in the capital.

The owner of a low-rental apartment block in Sibounheuang village said her apartment was always full, and whenever somebody moved out there was always somebody waiting to move in.

Her apartment building was built four years ago and she never thought that the demand for rental apartments would be as strong as it is today.

Meanwhile, expat employees tend to prefer rental condos or houses with better facilities, Mr Houmphan observed. The houses in highest demand among foreigners command a rental price of US$500-800 per month.

There is also a reasonable demand for properties in the US$1,000-US$1500 range, especially among highly paid consultants and diplomatic staff.

Mr Houmphan said the number of expat employees living in Laos could be about 50,000, including those from Thailand, China and Vietnam.

Of the total figure, at least 10,000 expat employees are thought to originate from western countries in the northern hemisphere and Australia.

vientiane times